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3:58 pm

Sun May 19, 2013

Boom Or Bust? Saving Rhode Island's 'Superman' Building

The iconic Industrial Trust Tower, knows as the "Superman building," stands in downtown Providence, R.I. The art deco-style skyscraper, the tallest in the state, lost its last tenant when the bank's lease expired in April.

Steven SenneAP

Rhode Island is home to beautiful beaches, top-notch universities and a thriving arts scene. Beneath the surface, however, the state faces challenges similar to other parts of the country: shrinking revenues, lost jobs and general economic malaise.

In Rhode Island, the issue has come to a head around the future of the once-iconic Industrial Trust Tower, or, as it is known more affectionately, the Superman building — named for its resemblance to the building the Man of Steel leaped "in a single bound" in the original 1950s TV series. The building is empty for the first time in 85 years, and casts a shadow over a city struggling to reinvent its economy.

A company called High Rock Development took ownership of the Providence landmark on May 1 and presented a controversial proposal to turn the office building into luxury apartments.

In its proposal to the Legislature, High Rock asked for $39 million of unspecified assistance from the state, and $10 million to $15 million in tax breaks from the city of Providence. So, for a grand total of up to $54 million, Providence will get a couple-hundred high-end apartments.

Everyone has an opinion about the future of the tallest, most prominent and instantly recognizable property in town.

"They should turn it into something that's going to help get more jobs out there for the people, that's about it," says Wendy Bolereo, a Providence resident.

Others like the idea of the apartments or condos but don't see how the city and state can provide the assistance considering their economic situation.

Learning From Past Mistakes

The dark cavernous main hall of the Superman building is deserted. As recently as a month ago, residents could cash checks in the bank here. Pens still sit in slots where tellers used to be.

Fischer says his company respects Providence Mayor Angel Taveras and the city's emotional attachment to the 1927 art deco skyscraper, and that he wants them to be a partner in the building's future.

"But it has to be viewed from a unique perspective," Fischer says, "because the alternative is we flood the market with class-B office space, or we mothball it for a while, and that's not some political or retaliatory tactic — it's a sound real estate tactic."

Fischer says adding more residents to the downtown area would serve the city better than more office space because of the increased spending and tax revenue.

"We're talking about annual spending, just in sales tax alone from those residents, totaling $26 million," he says. "So there's real economic impact if they are willing to make the investment and willing to think long term."

For this particular investment, there's more at stake than just money, however. Rhode Island is still burned from a previous debacle that attracted national attention.

In 2010, former Red Sox pitcher Curt Schilling asked the state for a $75 million loan to start a video game company in Providence, after Massachusetts had turned him down for the funding. He promised the state hundreds of jobs.

Rhode Island hoped a successful tech company would draw more businesses to the state, so they gave Schilling almost everything he asked for. Schilling was a local sports hero, but not experienced with tech startups. Last year, his company, 38 Studios, went bankrupt; Rhode Island was left with the bill.

Len Lardaro, an economist at the University of Rhode Island, says he wasn't surprised when 38 Studios declared bankruptcy. He worries that the state is in for a second round of defaulted loans if it rashly supports redevelopment of the Superman building.

"Well, let's see how badly run the city and state are," Lardaro says. "If they [the developers] get major concessions of the magnitude they're looking for, then Rhode Island will have earned its lagging status."

Lardaro says the key thing to learn from the handling of the Superman building is not to get too tied to the past.

"You've got to always look at the best possible use going forward, not looking back," he says, "and you don't do that by being nostalgic with your money."

A Measured Approach

Lardaro might not need to worry too much, since this time around state and city representatives have been openly critical of High Rock's proposal. Taveras, the Providence mayor, seems determined not to let his city make the same mistake twice.

"If you are asking for governmental support, you certainly need to look at all possibilities," Taveras says. "Certainly, I will as mayor."

The Superman building is hard to ignore from his ornate city hall office, with its direct view of the imposing tower from every window. But Taveras is hesitant to endorse High Rock's proposal until he has more information.

"We will figure out what we can do ... to be helpful, and also the market will dictate some things as well," he says. "But I believe it will be a symbol of renewal and I look forward to that."

In the meantime, Taveras, and Rhode Island, have bigger issues to address. At 9.1 percent, the state's unemployment rate is the highest in New England and the sixth-highest in the country.

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

JACKI LYDEN, HOST:

From NPR News, this is WEEKENDS on ALL THINGS CONSIDERED. I'm Jacki Lyden.

Coming up on the show, the rush to document a dying German dialect in Texas. But we'll start off the show this week in another part of the country, Rhode Island.

(SOUNDBITE OF MUSIC)

LYDEN: This small New England state is home to beautiful beaches, top-notch universities and a thriving arts scene. But beneath the surface, Rhode Island is an example of what states all over the country are facing: shrinking revenues, lost jobs and general economic malaise.

In Rhode Island's capital city, Providence, the issue has come to a head around the future of a once iconic building. That's our cover story today: a look at the Rhode Island economy through the windows of the tallest building in Providence, the now vacant Industrial Trust Tower, also known as the Superman building.

BILL FISCHER: We're standing right in front of the Industrial Trust Tower in the heart of Kennedy Plaza.

LYDEN: Bill Fischer is the spokesperson for High Rock Development, which took ownership of this Providence landmark on May 1st and presented a controversial proposal to turn it into luxury apartments. And taxpayers are being asked to fund the project.

The building is empty now for the first time in 85 years, and that casts a shadow over a city struggling to reinvent its economy. Standing with Fischer on the front sidewalk, I can almost feel the tension over the future of the affectionately named Superman building.

When did it become known as the Superman building?

FISCHER: Some of us who are a little older remember the 1950s' original Superman TV series.

(SOUNDBITE OF TV SERIES, "ADVENTURES OF SUPERMAN")

UNIDENTIFIED MAN #1: Faster than a speeding bullet...

FISCHER: And at the beginning of that show, they had him leaping buildings with a single bound.

(SOUNDBITE OF TV SERIES, "ADVENTURES OF SUPERMAN")

UNIDENTIFIED MAN #1: Able to leap tall buildings at a single bound...

FISCHER: Then they had an image of a building that was very similar to this. It was not this building, but people thought it was for a while.

(SOUNDBITE OF TV SERIES, "ADVENTURES OF SUPERMAN")

UNIDENTIFIED MAN #1: Yes, it's Superman.

FISCHER: And the name caught on, the Superman building, and it's part of the Rhode Island lexicon, I guess, as they say.

(LAUGHTER)

FISCHER: Things like that stick in Rhode Island.

LYDEN: When you buy the tallest, most prominent and instantly recognizable property in town, suddenly, everyone has an opinion about its future.

FISCHER: Yup, it's kind of the buzz around here right now. Yup, everybody's asking what's going to happen to the Superman building.

LYDEN: A security guard posted outside didn't want us to use his full name. With the Rhode Island unemployment rate at 9.1 percent, who can blame him? But standing under the Superman building day after day, Bill hears a lot of the debate going on downtown.

FISCHER: So hopefully, they'll do the right thing, and what that is, I don't know. They're talking apartments. You know, I don't know if we need any more apartments downtown. Some people say yes; some people say no.

LYDEN: On April 30th, High Rock Development presented their demands. Here's what they asked for: $39 million of unspecified assistance from the state of Rhode Island; 10 to $15 million in tax breaks from the city of Providence. So for a grand total of $54 million from the state and city combined, Providence will get a couple hundred high-end apartments. Taxpayers go back and forth over whether that's a good investment.

WENDY BOLEREO: I don't think that's a good idea - apartments. They should turn it into something that's going to help get more jobs out there for the people, that's about it.

ROGER EISLEY: They're trying to borrow money from the state. The state needs it. Look at all the people that's homeless.

SANDRA FEAS: Yeah. As long as they make it equal housing, low income, go ahead, do the thing. Do it, do it. You know, housing is what we need, but we need low-income housing, you know? Not any more luxury apartments.

FRANK PIVIERA: I think it should be turned into those condos, but I don't see where the city right now can come up with the money to help them fund it.

LYDEN: We just heard from Rhode Islanders Wendy Bolereo, Roger Eisley, Sandra Feas and Frank Piviera as they waited for buses at the depot across from the Superman building. But I wanted to go inside.

FISCHER: This, we're walking right now into the bank lobby, or what was the bank lobby.

LYDEN: Bill Fischer, spokesman for the development company, took us inside the dusty cavernous main hall, where up to a month ago, residents could come in and cash a check. Now, it's deserted.

FISCHER: This is my first time back in the building since the bank closure on April 20th. And when I was here, there was a hustle and bustle of bank tellers and employees and customers. The pens are still in the slots. I mean, and so to stand here today, it's a bit eerie in here, and it's kind of sad.

LYDEN: Let's think of it this way: This building is Rhode Island's Empire State Building. This isn't a purely economic decision for the city and state. There's huge emotional attachment to this 1927 Art Deco skyscraper.

Do you think the city - let me put this gently...

FISCHER: Yeah.

LYDEN: ...do you have them over the barrel?

FISCHER: No.

(LAUGHTER)

FISCHER: How gentle was that? Look, we have great respect for Mayor Taveras and his team. Yeah, we want the city and the state to be a partner in this, but it needs to be viewed from a unique perspective. Because the alternative is we flood the market with class B office space, or we mothball it for a while, and that's not some sort of political or retaliatory tactic. It's a sound real estate tactic.

LYDEN: I asked Fischer if that building wouldn't better serve the people of Rhode Island as an office building, attracting a business to bring jobs downtown.

FISCHER: We think adding 450 residents to downtown Providence can change the direction of the city. We're talking about, you know, annual spending just in sales tax alone from those residents, so totaling $26 million. So there's real economic impacts if they're willing to make the investment and if they're willing to think long term.

LYDEN: For this particular investment, there's far more at stake than just money because Rhode Island is still feeling burned from a previous debacle that attracted national attention.

In 2010, former Red Sox pitcher Curt Schilling asked Rhode Island for a $75 million loan to start a video game company in Providence. Schilling came to the state after Massachusetts had turned him down for the funding. He promised Rhode Island hundreds of jobs. And the hope was that a successful tech company would draw more business to the state.

So Schilling got almost everything he asked for. He was a local sports hero but not experienced with tech startups, which some say should've been a red flag. Last year, 38 studios went bankrupt, and Rhode Island was left with the bill.

LEN LARDARO: Eventually, they defaulted on the bonds and they went belly up. So now, instead of really trying to make our economy better, the debate is, should we allow those bonds to default?

LYDEN: Len Lardaro is an economist at the University of Rhode Island, and he's one of the go-to guys for an analysis of the state's economy. Lardaro wasn't surprised when 38 studios declared bankruptcy last year.

LARDARO: This was something that was supposed to be a real game changer to give Rhode Island a major presence in the gaming industry.

LYDEN: And Lardaro worries that the state is in for a second round of defaulted loans if they rashly support redevelopment of the Superman building.

LARDARO: Well, let's see how well or how badly run the city and state are. Because if they get major concessions of the magnitude they're looking for, then Rhode Island will have earned its lagging status.

LYDEN: Maybe Len Lardaro doesn't need to worry so much. This time around, state and city representatives have been openly critical of High Rock's proposal.

MAYOR ANGEL TAVERAS: A city's more than a building.

LYDEN: In Providence, Mayor Angel Taveras seems determined not to let his city make the same mistake twice.

TAVERAS: If you are asking for governmental support, you certainly need to look at all possibilities. Certainly, I will as mayor.

LYDEN: The Superman building is hard to ignore from his ornate city hall office, with direct views of the imposing tower from every window. But Taveras is hesitant to endorse High Rock's proposal until he has more information.

TAVERAS: We will figure out what we can reasonably do to be helpful. And also, the market will dictate some things as well. But I believe it's going to be a symbol of renewal, and I look forward to that.

LYDEN: And in the meantime, Mayor Angel Taveras has bigger issues to address.

TAVERAS: The challenges we face as a city are similar to challenges that cities face across the country, and that is getting as many people back to work as possible. We need to increase the pace of employment.

UNIDENTIFIED MAN #2: They want to know (unintelligible).

UNIDENTIFIED MAN #3: Yeah, this is working good.

LYDEN: Even on the state's gorgeous beaches, the stress of long-term unemployment is a constant presence.

DAVID KITCHENS: My name's David Kitchens. I'm 53, and I have a bachelor's degree in physics. And what I'm doing here as part of a FEMA grant is doing beach restoration and cleanup from the Hurricane Sandy.

LYDEN: Kitchens tells us that usually there are eight men working on East Matunuck State Beach. But today, there are only four. All these men are long-term unemployed veterans, and they've been working since spring, shoveling sand for the beach pavilion and the parking lots.

KITCHENS: Old-time, honest labor.

(LAUGHTER)

LYDEN: Today, Kitchens and his team are putting up a fence to preserve the fragile sand dunes. Rhode Island has the highest unemployment in New England and the sixth highest unemployment in the entire country, 9.1 percent.

KITCHENS: The economic situation in Rhode Island, at the time that I got this job, it was still over 10 percent unemployment. So, you know, after 150 resumes and some 25 or 30 different interviews, this finally came along.

LYDEN: Working with Kitchens is John Douglas. He's been job hunting for three years and is grateful for this temporary gig, even though it's coming to an end in June.

JOHN DOUGLAS: I was in the construction mining industry. And with the economy hitting the skids with home building and stuff, it really fell right off. It started to come back now a little bit, so hopefully, things will change. But right now, this is very good. This is good work. You get to go to the beach every day.

LYDEN: A lot of the people we spoke with were optimistic for the future of their state. But not far from the beach where David Kitchens and his crew are cleaning up, economist Len Lardaro at the University of Rhode Island studies his charts and worries that if the city and state mishandle the Superman building, it will derail economic progress again.

LARDARO: I think that the national thing to learn from our handling of the Superman building is don't get too tied to the past. You've got to always look at the best possible use going forward, not looking back. And you don't do that by being nostalgic with your money.

LYDEN: And in such a beautiful, 19th century city saturated with history, forward momentum is what Providence and the state of Rhode Island need to pull out of the recession slump. Even so, all eyes are on the Superman building and its bright, green beacon that casts a constant light over the nighttime cityscape for now.